Ladies and gentlemen, thank you very much for viewing our earnings briefing session. Now this is streamed live.

And on the chat box, at the top right of the screen we will be taking questions throughout the program. Please ask questions at any time.

As to the questions received, toward the end of the program we will have a Q&A session in which we will respond to your questions. And the video of this earnings session will be distributed on an archived basis.

Let me introduce the speakers. My name is Tsuruoka, Representative Director and CEO.

My name is Harada. CFO, Director and Senior Executive Officer.

Yamamura COO and Senior Executive Officer.

Let us begin. As always, I Tsuruoka will provide an executive summary upfront.

And that will be followed by the presentation by Harada of the business performance by each business. Now, let me turn to page 4, as always, so this is about the mission of our company.

So on page 4, there's a statement of our mission Payment to the People, Power to the People. This is the mission that we uphold.

Are we seeing that on the screen? Yes.

So this is on page 4, mission statement of Payment to the People, Power to the People. This is the mission that we uphold.

This year marks the 10th anniversary. Since our foundation, we have always focused on providing the power to the people as we develop our products.

So over the internet, to the individuals to the small groups, we provide payment services. And we would like to contribute to increasing the affluence for society by empowering these people.

So payment to the people, as we say, freely on the internet, we want people to do business, engage in payment, use financial functions. So throughout such themes, we would like to deliver payment to the people.

And based on this submission, we are developing products and implementing measures. Moving on to page 5, this is the outline of our businesses.

So this has been updated slightly from before. The products are three fold and that remains unchanged.

On the far left had, BASE Service. This is something that we've been doing since foundation, and this is our main business.

With this service or product or you're able to create an online shop easily be it an individual or a small group of people. You may lack engineers within your team, you may lack technology or financing.

Very easily within a few minutes of time, you're able to create an online shop where payment functions or services can be provided. And in the middle is PayID.

In the last few meetings we've started to explain about this service. This is the product for purchases and this is the only product for purchases we provide.

And PayID is given as a standard function. A basis for creating an online shop, PayID is a service for making purchases easily.

So 170,000 shops who participate by having PayID account people will be able to purchase very easily and the number of shops as they increase, the PayID customers will increase, since the service is not only for the merchants but service is for the consumers or all the shoppers are also being provided. And that's something that we would like to increase.

On the far right page, PAY.JP is also a payment function. BASE is for those who do not have internal engineers, technical people.

Well, we are providing two functions, creating shops and providing settlement function. Page.JP is for those who require a payment function only.

So for IT startups, platforms and web services, they may be able to develop those on their own. And for those people who have first such development capabilities we’re providing this payment functionally, and that is called PAY.JP.

So these are the three businesses. And why do we have few businesses, that's on page 6.

Since the last meeting, where we presented the full year results, we've been explaining this, based on our mission statement, Payment to the People, Power to the People. In order to achieve that mission we believe that these are the products that we need and thus we have three; BASE and Pay.JP.

We are focusing on developing merchants for PayID, we are developing our customer base, our customer site. And around BASE for merchants, we are supporting various services and products by relying on third-party partners.

And but more freely more cheaply and more conveniently, we want the merchants to do their business. That's our aim.

And purchases for them to freely make purchases. For the past decade, we have worked to create EC business and in the next decade, empowering the purchases will be enhanced.

So by having a payment network, we would like to provide even clear and more convenient and upgrade payment experience for purchases. And so not just create helping create online shops, we would like to provide these payment functions for the individuals as well as the business owners.

And that is why we're working on these three continuously. Moving on to page eight.

Here's the executive summary. And let me explain this.

In terms of the topics, over the medium to long term, we would like to drive the growth of GMV for both BASE and PAY business. We are achieving very high growth.

Of late starting from April 18 we have started to provide monthly fee plan on top of the new monthly cost plan as the second plan. We are providing this new monthly fee plan since April 18.

The details will be provided by Harada san but for the first quarter results on a consolidated basis GMV for both BASE and PAY increased. So consolidated net sales increased by 12.3% year-on-year.

For the BASE business overall EC-related sector saw effects of a reactionary decline. Following the recovery in offline consumption, we see that both on the consumer side and the business side.

Therefore Y-on-Y growth has been limited to 9.6%. For PAY business so GMV continued increase significantly at 55.5% year-on-year.

So the policy for FY2022 is that we will not be swayed about short term business environment. As we said before, over the medium to long term, we will like to make upfront investment and develop our products, so that we will be able to maximize our net sales and GMV.

So monthly plan and scout team updating products. So we've seen a number of the progress in the first quarter, which I will explain later.

Moving on to page 9. So FY2022, the year ending December 2022, what's going to be the business environment?

As I said, EC macroeconomic environment surrounding BASE. Looking at the business results related to EC-related sectors in Japan and outside, there has been reactionary decline seen in these sectors because of increase in offline consumption.

And in the BASE business we're seeing that impact on the consumer side, the shopper side as well as the merchant side. And the details are as described below.

So the frequency of using online shops for travel. And I think there's recovery in other product categories.

And so this has led to decrease in the use of online shops and offline consumption is increasing for the consumers and thus reducing online consumption and that is because COVID impact is starting to shrink in the world. So the changes on the part of the consumer or shopper are being reflected in average net sales.

That is why the growth and the monthly number of active shops is still linked and also doing growth in GMV per shop on a monthly basis. The growth structure that we would like to achieve in the medium to long term, however, is not being eroded by this.

So we'll make sure not to be swayed or affected by short term changes in the environment. Over the medium to long term we do believe that there's still growth to be had.

So in order to drive net sales and GMV we will continue with our upfront investment for the future. Moving on to page 10.

Over the medium to long term, what's going to be the growth track for GMV for BASE business, in the first quarter, we achieved 20.1 billion yen. In terms of CAGR, plus 53.8%.

So we are seeing very high levels of growth continuously. Page 11 is about the PAY business, likewise compared to the previous year, there's robust growth.

So in terms of CAGR, plus 90.7%. So over the long term, just as just like BASE, PAY is also growing at a very high growth rate.

Page 12, so the group, what is the overall policy for FY 2022? This is excerpt from FY21 Q4 materials.

For further details in the reference material, we have given descriptions of this policy. So I would like to skip this page for now.

Page 13, I just described on page 12, in BASE business, the policy for FY 2022 is as described indexed from FY21 Q4 materials starting from April, we started our monthly price plan. We launched a scout team.

And as to the progress of such matches, I would like to update that using Page 14, the next page. So what is the progress we have seen in the first quarter in terms of the policy we announced earlier?

So with the launch of a monthly fee price plan, acquisition of new shops, so with the scout team, that effect will start to be seen in the second quarter. So in the performance of the first quarter, that is yet to be reflected and therefore the first quarter is not yet reflective of that.

And now as to the measures, so what are we going to do? What are we doing now and in the future?

In terms of monthly fee plan, we have developed the system for that as planned. And since April 18 service has been provided in terms of sales in order to acquire large shop sales.

So shops, we are recruiting the members for scout team and we already recruited the necessary number 20. They are now working in full scale.

In terms of marketing, we have overwhelming brand recognition for net shop creation service, but we're going to have marketing measures so that we will be recognized by larger shops and they will want to use our service over the long term. In terms of product development, we are releasing a number of new products that are being used by a wide range of shops in order to enhance functions, where we will continue to strengthen hiring for our product team.

Page 15. So these are the details of the monthly fee plan.

There are two plans that we provide this time starting from April 18, we have started the monthly fee plan as is described on the right hand side of the table. Pay as you sell system without any month fee, a cost that was what we had conventionally referred to as no monthly cost plan.

6.6% plus 40 yen that was the total of fee that the shops have had to pay. And on top of that we added this monthly fee plan.

We have fixed a monthly fee that we charge 5,980 yen. On top of that, we would charge a lower rate of payment of fee.

So shops with large sales, or shops who are looking to grow fast. By reducing their running costs, they will be able to run their stores and this has proven to be popular already.

Compared to our peers, our fees that we offer are overwhelmingly low. So those who want to reduce risk, they can use the conventional BASE plan and once they started to grow, they will be able to use monthly fee plan.

So in terms of the pricing, I think that we have an advantage for the long tail customers, especially since we launched this month a fee plan a new plan in April. Moving on to page 16.

So after this new plan was provided, what's been the level of use? Starting from April 18 we launched and started to offer this plan.

This is new, but as of the 30 of April 1,907 shops have already signed up for this plan. It's off to a very good start.

And on the right hand side, current situation of monthly fee plan and future measures are shown as planned, centering around existing shops. We have tried to promote monthly fee plan and the uptake, adoption has been quite good.

So larger shops so who have developed organically in the first quarter, they have started to grow gradually in number. So we're not just going to utilize the scout team but organically as well.

We would like to permeate BASE service, so that we will be able to make sure that larger shops with larger sales will be able to access this plan and utilize it. So that's how we're going to increase the number of new users and for existing shops, for good merchants, we would like them to switch over from the conventional plan to the monthly plan.

So that we will be able to reduce the turnover rate and increase the number of shops who will be able to enjoy a wide range of BASE services. Page 17, so this is about the launch of the scout team.

As is shown on the left hand side graph, monthly fee plan is being provided. But even since before that we started to gradually hire for the scout team.

And the target number of people for the team was 20, we hit 20. So the team is in a full scale activity.

It's so new, it's so premature to have an overall assessment of how the team is working. But they're acquiring shops.

For the shops to be up and running there's a lead time. But even given the lead time we're seeing progress.

On the right hand side, we'll see specific examples of newly opened shops or by the scout team. It's been described by the last meeting that we had.

Please refer to page 18. So this is about the progress in product development.

There are some excerpts we highlight on the left hand side, extension function, those with large sales with multiple staff members, they wanted to have this service. So staff authority management, but that's what they wanted.

And thus we released this. In developing products, we are focusing on the needs of larger shops with larger sales.

So we will be enabling issuance of multiple accounts per shops. And I think we'll be able to better support these larger shops.

So now on the right hand side, our Cart Abandonment Prevention Mail. This is now a standard function that we offer.

So an item that's put in the shopping cart, to the consumer who's an avid shopper who failed to purchase the item in the cart, automatic email will be delivered to them, reminding of the item that they put in the shopping cart so that they will be encouraged to shop. And on the platform side, there's a lot that we can do to support the shops.

And so finally, we're developing these products that are being required and are releasing them. Page 19, this is the last page for me to cover.

So as part of our product development, in the third quarter of last fiscal year, we made an announcement that we're having business alliances with TikTok, how is it progressing? Prior to the full scale release covering all the shops, we have started to offer the beta version to a limited number of shops that started on May 17.

So you don't have to register anything. With a simple setup connecting, you will be able to automatically generate video using TikTok through this aliens.

So among the shop owners here in Japan, I think we are advanced so we're ahead of the curve. I think we have an advantage from the customer's point of view.

I think this is one of the most attractive functions that BASE can offer. So alliances with TikTok and other companies.

So offering communication and that is something that we would like to continue to do. So with that, I would like to conclude the executive summary and I would like to turn it over to Harada san.

Yes, this is the Harada, CFO. I would like to give you the update on the business performance.

On page 21 I’d like to give you the financial highlights for the Q1 results. As Tsuruoka mentioned on a consolidated basis, BASE and PAY had growth both in GMV and Y-o-Y growth, in the net sales with 12.3%.

For BASE, offline and consumption recovered. There was the repercussions for both shops and purchasers.

So GMV Y-o-Y growth rate was contained to 9.6%. On the other hand, for PAY business GMV continued to significantly grow.

Both net sales and gross profits grew over 50%. Next on page 22, here is the more details of the performance.

On the left hand side, you see the Y-o-Y change in the first quarter and on the right hand side you see Q-o-Q change. Net sales, as I have already mentioned earlier, the consolidate GMV both grew, therefore, a 12% gross was achieved on year-on-year.

On the other hand, for SG&A expenses we continue to strengthen the forward-looking investments. On the left hand side Y-o-Y showed 27% increase.

On the other hand, for the right hand side Q-o-Q change because of the decrease in promotional expenses through coupon issuance and SG&A decrease therefore as a result our Q-o-Q operating loss decreased. Next, page 23.

And this describes the balance sheet. While there is no particular significant change, but what I'd like to emphasize on is the cash is 22 billion yen.

Therefore this suggests that 15 billion yen or so in the net assets therefore, we believe that we have maintained a strong financial base. So that we have ample funds for making investments going forward.

I would appreciate it if you could understand this. Page 24, RS, restricted stocks to be granted.

We made announcements today, RS. For executives and officers for enhancing their commitment to the medium to long term contribution to the enhancement of corporate value as well as the sharing of the value with shareholders we announced that we are granting RS.

The details are described here by granting this the impact of a dilution will be very minimal and the potential stock ratio will be contained at around 4.8%. On page 25, here is the GMV trend on consolidated base and BASE GMV and a PAY GMV can bind together on this page.

BASE business and PAY business are providing payment of services and between the two businesses there are no overlapping GMV. Therefore, this is the consolidated base GMV which is the amount of payment service provided by the whole group.

For the first quarter 45 billion yen on consolidated basis. Therefore year-on-year gross was achieved for both BASE and PAY.

Next net sales, BASE and PAY are charging the commissions or fees for payment services. As we saw in the previous page in line with the growth of the GMV, sales could grow, so in line with the growth in GMV in this quarter as well.

So accordingly, the consolidated net sales grew 12%. Here is the ratio of net sales by business.

PAY continued to be stronger during the quarter. As a result, net sales competition ratio based business declined Q-o-Q.

This is the point on this page. Next gross profit and gross profit ratio.

As has been mentioned earlier, the sales conversion ratio of BASE declined and therefore, the gross profit margin on a consolidated basis also declined. Next SG&A expenses.

For these M&A expenses, as you see in the pink portion, the BASE business promotional expenses more specifically, these promotional support through coupons conducted in the fourth quarter as well as the brand recognition promotion methods such as TVCM, the expenses declined. Therefore, SG&A as a whole declined 18% Q-o-Q.

On the other hand, the forward looking investments for product development has continued to be enhanced. Therefore personnel costs and also compensation, outsourcing and recruitment and so forth included in the other expenses have increased Q-o-Q.

For this fiscal year, by enhancing the efficiency in marketing, ad promotional expenses will be suppressed and however on the other hand, we are continuing to make investment in scout team to acquire large scale shops. So promotional expenses are not considered to be increased.

However, personnel and outsourcing expenses are expected to grow. Next number of employees.

As I have said on the previous page, we are still focusing on our efforts to recruit and therefore we are making good progress in this. From the second quarter onward, we are enhancing our recruitment of the people mainly in the product and personnel.

On page 31, which shows the operating profit or loss. As I have said -- mentioned earlier, we are strengthening the forward looking investment as well.

Therefore, in the first quarter we had a loss, but on Q-o-Q basis, mainly the promotional expenses declined therefore, loss has decreased. From now on, I’d like to give you the performance for each business first, BASE business, trends in GMV on page 32.

Last year, first quarter, there was the emergency declaration for the first time in six months. Therefore, there was the impact of repercussion due to the recovery in offline consumption recently for both shops and the purchasers.

Therefore, the one-year growth was contained to 9.6% and on Q-o-Q as well, because of that decreased impact of the COVID-19 as well as the repercussions of the sales promotion. Support through coupons which was conducted in the fourth quarter last year, GMV declined, and also seasonality Q-o-Q there was a decline on Q-o-Q.

Next on page 33, the GMV trend. Here is the GMV due to the new shops.

Compared to the previous year, the same level of GMV has been accumulated. On the other hand those existing shops which were opened by the end of 2021 because of the impact of the reduced impact of COVID-19 as well as the sales promotions such as coupon conducted in the last fourth quarter and a GMV decline and also seasonality, there was a decline in GMV Q-o-Q.

Next page 34, this is the trend in GMV by KPI. On the left hand side our monthly GMV is calculated by multiplying the number of monthly active shops and monthly average GMV per shop.

And monthly active shops, as I said earlier, there was a recovery of the offline shopping because of such repercussions. Y-o-Y increase was contained to 6,000 shops.

On the other hand, per shop monthly average GMV because of the change in the behavior of purchasers there was a slight decline on Q-o-Q basis. Similarly, due to the recovery of the offline shopping and also because of the decline from the GMV, which was increased by the sales promotional support, such as coupon and the number of monthly active shops and monthly average of GMV per shops were increased in the last quarter.

Therefore there was Q-on-Q decline. And the monthly average GMV per shop was decreased Q-on-Q for the first time, but this is the cause of the repercussion.

But this is not suggesting the impact of the churn of the shops or merchants. This is merely the repercussion from the previous increase.

Next take rate on the GMV. And the take rate is the sales divided by the GMV and Q-on-Q growth was flat at 7.7%.

In the first quarter under review, our monthly fee plan was not launched yet. Therefore, the impacts on the take rate by the introduction of a monthly fee plan is not included in the first quarter results and this impact will be shown from the second quarter onward.

Next page 36, this is about a net sales and gross profit and margin. Regarding the gross profit on Y-o-Y, in line with the increase in GMV gross profit grew as well.

On Q-o-Q because of the decline in GMV, gross profit declined as well, but gross margin due to the improvement of the cost of sales ratio slightly improved. Lastly, this is the business results for PAY.

Regarding the GMV for PAY business, the existing merchants continued to grow and also increasing at new merchants so we could achieve the Y-o-Y 55% growth rate which was quite high. Next is the PAY business, net sales and the gross profit.

Similarly, over 50% growth rate was achieved. So this is the end of my explanation about the business performance per business.

Thank you very much. Regarding institutional investors, could you please a hold for about one minute so we are going to have to have a Q&A session for the year ending in December 2022.

This is the financial results briefing for the first quarter. Thank you very much for taking time out of your busy schedule.

Thank you.

So the number of store opening in the first year GMV, if you compare Y-on-Y there’s a decline and so, why is the impact, why the decline? Yamamura will respond to that.

So I think the number monthly number of active shops is being affected and there was issuance of state of emergency and there was greater demand for online shops. But that impact is gone now.

So this year, monthly number of active shops is down more.

[Indiscernible] of Securities asked a second question. For large scale shops with a Y-o-Y and Q-o-Q growth rate in the monthly average sales GMV and also then the growth of the monthly average GMV what is the comparison with the overall and what is the impact of the reactionary decline from the last fiscal year and what is the impact?

Yamamura san is going to respond. Yamamura is going to respond to the question.

Regarding the situation about the large scale shops on Y-o-Y basis are steadily growing. And because of this is the background for introducing the monthly fee plan.

Therefore those large scale shops are growing, top three shops included and a top shops -- top line is growing compared to what it was last year. And I think that is the current situation that they are steadily growing.

And regarding the impact of the coupon, at the end of last year, we issued the coupons and this is rather than impacting on a specific segment, but growing the overall shops sales and therefore not specifically limited to the impact of specific segments of the shops.

Next from SMBC Nikko, [indiscernible] has asked the following. Outbound sales, so scout team has started in full scale in April.

What's been the traction or progress made so far? The number of shots using this new plan, 1,907 how many of them were acquired by the scout team?

Yamamura will answer that question.

First of all, with respect to the scout team in the first quarter, it's now fully launched. We now have full members on the team and they're successfully engaging in sales activities.

And I think they're being active more so than we initially expected. And so there's a lot of progress that we're seeing from the scout team.

So the monthly fee plan, the new plan, existing stores have switched over to this new plan. And as to the results of the performance of the scout team, I think we will be able to see that some more fully in the second quarter.

Next from [indiscernible] as well. For this fiscal year regarding the policy whether or not so you are going to implement the sales promotional support or including the coupon.

Okay, we would like to respond. This is Yamamura speaking.

As regards to coupons, we conducted a coupon sales promotion on a regular basis and impacting on the monthly active shops as well as the unit sales volume. And therefore, as far as it is a reasonably conducted, we like to continue to do this issue on coupon targeting the specific segments and the limited coupons will be able to be provided.

Therefore considering the situation we'd like to conduct appropriately on a regular basis.

Now show David Gibson [ph] has asked the following. Those who are using the monthly price plan, how many of the 1,907 stores are using that?

Do they have GMV of over 1 million per month?

Well, yes. So this is something that we started in April.

So in the first quarter results, we will not show them. So I would like to refrain from answering that question.

And more from David Gibson as well for this business GMV and compared to March what is the change from March in May -- in April?

Well, similarly, as we responded to the earlier question, this is out of the scope to be disclosed for this particular quarter. Therefore we'd like to refrain from responding to this question for this meeting.

Tommy Matson [ph] from Mizuho Securities, Tommy Mattson has asked three questions So I would like to read them. The first one monthly plan, Tsuruoka san said that it's been received well.

It's popular. If you could please elaborate on that in greater detail.

In the second question about the activity of scale plan, are they engaging activities that would accelerate the number of acquisitions? And you're talking about existing stores?

And are they shifted from other existing platforms? Tsuruoka will answer.

Well, this started in April. The details will have to be disclosed later.

But about this. I think we made an announcement in around February, we said that we're going to start a new plan in April, back in February.

And so what's been the reaction to the release that we made. From a number of shop owners, they have reacted to this quite favorably looking at SNS, they are saying that they would like to use BASE now that the service fee is lowered.

And so since the announcement, I think things are moving quite well, in the last few months. And after April 18, during the first quarter, the number of shops being acquired, I think the pace has accelerated.

And so I think those are the indications are showing that this plan is popular. But then on the other hand, there are those who look at us based on the old plan.

But as I said, if they don't want to take a risk, so they can use the conventional BASE plan, and if they grow and become bigger, they can use the monthly plan. So we will like a number of different shots to utilize this.

For the second question, right for the particular question, it is difficult for me to explain specifics. But as we explained in the financial briefings for the first quarter, there are several shops that are being scouted and turned the update and getting the turnover.

So we are reaching those milestones. And for details, we like to report it to you for the financial result briefing for the second quarter onward.

And there has been a reaction and there has been a good response from many shops. Therefore we are able to communicate well.

And I think that the long tail of our shops will continue to support. So we would like to stay confident in appearing on this.

So any customer is shifting from other platforms, there are a number of different patterns of acquisition. It's hard to generalize.

There are those customers who moved from other platforms and other shops who are starting from scratch, creating the totally new shops, and so there's a mix. Over the longer term, we may be able to see a clear pattern once we grasp at such a pattern, we would like to explain that but at this moment, while there are acquisitions, shifts up in other platforms as well as new ones.

Tommy Matson from Mizuho Securities. For BASE business take rate increase the five times from Q-o-Q and very stable [ph].

Do you think that the sales commission mix of BASE has stopped declining?

This is Harada speaking. Currently, for the first quarter, the mix of payment services have not changed from the fourth quarter.

Therefore, the take rate had stayed flat. Whether or not this mix has stopped declining, we are not able to say but for the first quarter, the commission by the purchaser has not declined due to change in the mix.

Another question from Tommy [indiscernible]. With recovering offline consumption, so, in a like manner it seems that that impact is showing at the shop level while this deteriorating effect increased in the shop by sales.

Well Tsuruoka will answer that question.

Well, as you rightly pointed out, there's recovery of offline consumption. And so that negative impact is being seen starting from the first quarter.

It's a fact and I don't think it's limited to our base business. I think it applies to Japan overall.

And all the other companies around the world are looking at their business results. I think we're seeing a similar trend.

And so no doubt, there such impact from recovery and offline consumption. How long will this impact continue?

It's very difficult to judge at this moment. As I presented, in order for us to grow, the structure that we need for growth that in itself is not being affected or eroded.

Because the conditions in the market, our numbers are being volatile. What will happen in the next one to two months, it's very difficult to come up with a forecast myself?

But looking at the next two to three years, I'm sure we will be back on a positive growth track. So we're not being pessimistic.

So if we can appeal the functions that we offer and developed the right product, I think by overcoming the challenges, we will be back on a growth track. So that is something that I would like to work on, we would like to work on.

So impact on the purchases, how that will affect the merchants or business. Within BASE set business, only 70% of the customers -- 70% have only online shops.

Because of the change in the demand of the consumer, that has been reflected in the online shop business the consumers, which are 70%. And so if the tendency is to quit doing online shops, that would be not good.

But that is not the trend that we see. It’s the consumer behavior that is being reflected in the GMV per shop or unit price of the sales?

So once the impact is gone, I think we'll be back to a more positive trend. I hope I answered the question.

From [indiscernible] there is another question. BNPL development policy, and could you please give us the update or progress of the development of BNPL?

Yes, Tsuruoka is going to respond.

Right. When we had a financial briefing for the previous quarter PayID team has been formed basically from this fiscal year and direct under me, a corporate planning office who has the main mission of making the plan for the next 10 years and considering we believe that we have been able to have a productive discussion with partners and like in BASE, we have GMV and like in the PayID, we have the purchasers as assets.

So we have such a platform of those assets. And I don't think that that there are many other such platforms in Japan.

So since that announcement, I think there has been a relatively good response from users and also candidate companies as partners have shown favorable response. And I think that we will be able to realize those responses and I think so far progress has been in line with schedule.

So at appropriate timing, we would like to report it to you on the progress.

Next Tommy Matson from Mizuho Securities is asking as follows. What is the impact of reduced ad spend as the number of monthly active shops or other KPIs do you think that there's going to be future impact on these indicators going forward?

Yamamura will answer that question.

So we reduced our ad spend this time over the medium to long term we would like to make the investment to raise recognition and that's been reduced somewhat. But because of the activities that we had so far up until last year, I think we are able to raise recognition and no short term negative impact.

And listing to the customers those short term KPIs, given the benefit of ROI, I think we're continuing with the good levels of investments, I don't think there's going to be any short term impact on these KPIs.

From SMBC Nikko Securities, so we have a question from [indiscernible]. For offline consumption, which has shown recovery and the average GMV per shop and month active shops are there any liabilities for different categories.

Yes, let me try answering that question. Due to the recovery of the offline consumption, the decline per category is not analyzed, because of our available indicators.

We do not have such data and regarding the Q-on-Q decline because of the seasonality impacts of the fashion category, so based upon my gut feeling, in principle, the impact of offline consumption is not shown in specific segments, but rather the customer's purchase amount on the online shopping has been diverted to others. So I don't think that there are any particular liabilities according to different categories.

Tommy Matson of Mizuho Securities has another question on top of COVID-19 geopolitical risks are manifesting. And so compared to six months ago, macroeconomic forecast is becoming increasingly uncertain.

So in terms of investment and others, are you looking to make adjustments to your plan?

Well, thank you for the question. Well, yes, slight adjustments may, perhaps have to be made.

There's that possibility, I note. No doubt there's going to be changes happening in a business environment.

So as management, we will look at what's happening in society, what's happening to our base business. And the situation with segments that are relevant to our business we will continuously watch that.

We are a startup company. So each time, we will watch closely and make changes in our strategy as necessary.

But at Haraka san said well, we have a good balance sheet, good assets we've accumulated. And so at this moment, we have not made a decision to make changes to the plan.

So we would like to continue to try what we can based on the plan that we announced back in December and grow over the medium to long term.

With this I think we have covered all the questions we have received. So with this, we'd like to close Q&A session.

In Q&A session, as well as our briefing session for Q1 results there was impact by COVID-19, as well as the current impact on the macroeconomic situation. But rather than focusing on the short term changes, but we're going to focus on the medium to longer term perspective, so that we will continue to provide values and in 2022 we have maintained the solid balance sheet and we would like to continue to be moderate and so that we are able to provide more added values in the medium to long term perspective.

So I hope that you will continue to support us and thank you very much for your time today.